Gama Aviation PLC (LON:GMAA) took off on an upgrade from Cantor Fitzgerald as the aircraft maintenance and management group reported good revenue growth in the year just ended.
Cantor upgraded to ‘buy’ from ‘hold’ as Gama said revenue growth was more than 10% higher year on year on a constant currency basis, driven by a 12% increase in aircraft under management and an improving European business.
Growth was primarily organic and weighted towards the second half with the US Air business seeing revenue growth of over 20% and US ground up over 10% with three new maintenance bases added.
The bullish update follows on from last week’s joint venture agreement in the US with BBA Aviation (LON:BBA).
That deal will involve 200 aircraft and create a market leading platform for maintenance and aircraft management services, according to Cantor.
On a 2017 earnings multiple of just 5, the shares trade at a significant discount to its business aviation peers, said the broker which has a 200p price target.
Shares rose 12% to 172p.